Alan Cross: Why are people still bothering to steal music?

Back in the old days of overpriced CDs and peer-to-peer file-sharing, the record industry was brought to its knees by people stealing music. Steve Jobs offered some respite from the carnage by strong-arming the labels in accepting his terms with the iTunes music store, but the bleeding continued through programs like Kazaa, Limewire, Bearshare, Audio-Galaxy and dozens of others.

Music sales dropped from a peak of nearly US$22 billion in 2000 to less than half that 10 years later largely due to piracy.

Streaming was supposed to stop all that. By making virtually every song ever recorded available online for a low monthly fee (or, in the case of Spotify’s freemium tier, nothing at all), the thinking was piracy could be eliminated. Today, the streaming services give users access to a library of 45 million songs and counting.

You’d think that with the ubiquity of streaming services that it would be mission accomplished. No viruses. Proper metadata. Access to billions of playlists. The ability to make your own playlists. Constant recommendations of new material. High-quality audio. And if you’re a paying subscriber, you can listen to all your music offline. All you have to do is keep paying your monthly subscription fee — usually $9.99, the price of a couple of fancy coffees — and you have the whole of human musical history at your fingertips anywhere, anytime.

But this miracle of convenience isn’t good enough for some people.

A new survey on how people around the planet consume music says that 38 per cent of online music fans still insist on engaging in some sort of music piracy. The study, commissioned by the International Federation of the Phonographic Industry (IFPI), looked at the habits of people aged 18-64 in 18 countries (Canada, the U.S., the UK, and France among them) and found that there’s still plenty of music acquisition happening through illegal methods.

Stream-ripping is the biggest source (favoured by 32 per cent of those who steal) of illegal music. This is the process of finding songs you want (YouTube is the biggest source) and then using software to capture the audio as an MP3. You then have the music file and can do what you wish with it. The industry is trying to crack down on purveyors of this software — a big site, Youtube-mp3, was shut down in 2016 — but there are still plenty of them out there. FLVTO.biz is one of them and it just fired a big lawsuit at the Recording Industry Association of America over its right to exist.

Another 23 per cent use cyberlockers (clandestine storage sites of illegally-obtained music that often require users to be carefully vetted and introduced) or whatever peer-to-peer software is still available. Search engines like Google can also turn up files for the taking, the preferred method of 17 per cent of thieves.

Why go through all the trouble of stealing music when streaming is so much easier? The justification comes in several flavours.

The free tier with its ads and hobbled features aren’t good enough for some people. They want to listen offline, which you cannot do without a monthly subscription. They want physical possession of music files so they can do what they please.

They don’t want to pay for data to their phone.

Some of the people in this survey were in places like Brazil where many don’t have access to credit cards, which makes it impossible to sign up to a premium streaming service. (China and India were also surveyed but those stats were not included in the final global numbers. If they had been, the piracy rate would likely have been much worse.)

There’s also another sort of piracy that most people don’t even consider in the same league. The IFPI estimates that the industry loses out on US$2.65 billion each year by the misuse of streaming sites.

If you run a business — a restaurant, store, office, hair salon, whatever — and you play music throughout your establishment, you’re supposed to pay a public performance fee to the local performing rights organization or PRO. This is standard copyright law in countries around the world. The thinking is that if you play music as part of the way you conduct business, then the people who own that music should be compensated.

In Canada, an entity called SOCAN collects this money and distributes it to its member artists and composers. The cost of a public performance licence depends on things like square footage and the number of speakers being used. For a typical small business, it’s peanuts.

Some businesses are getting around paying for a licence by firing up Spotify or Apple Music. The copyright laws governing streaming services are different from those regulating public performance. In other words, choosing to stream Spotify’s Rap Caviar playlist in your pet store is actually ripping off artists. Under international law, you cannot use your personal streaming account for background music in your store.

According to the IFPI study, only 17 per cent of global businesses have acquired the proper PRO licence while 83 per cent use a streaming service. In other words, they’re pirating music without even realizing it. Instead, they should be paying an accredited music supply business.